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Porter’s Five Forces Analysis of Country Garden Holdings

<p align&equals;"justify">Country Garden is one of a Chinese leading property development company&period; It is comprehensive high-tech enterprise which believes in creating beautiful living for the world&period; The company is committed to provide good community and houses for ones seeking better life&period; It is operating since over 20 years&comma; and work towards different ways of urbanization&period; The company has taken the responsibility of developing real estate in over 1200 towns&period; The use of advance technology has helped the company in building green ecological buildings&period; The company worked towards modern urban cities&comma; Forest cities and many other towns&period; The company is growing successfully &lpar;Country Garden&comma; 2019&rpar;&period;<&sol;p>&NewLine;<p align&equals;"justify">The Company is working so enthusiastically and growing each day&period; It is important for it to analyze the industrial competition level in order to maintain its success rate&period; The Porter five force model helps the company in identifying the industrial competition level&period; this further helps in making effective strategic decision&period; Here is the detailed Porter five forces analysis of Country Garden Holdings&semi;<&sol;p>&NewLine;<h2 align&equals;"justify">Bargaining Power of Buyers<&sol;h2>&NewLine;<p align&equals;"justify">Bargaining power of buyers is an important factor for the company when deciding the prices&period; It helps the company in analysing its position in the market in consumers’ eye&period; For country garden&comma; its consumers’ bargaining power is weak to moderate&period; One of the main reasons for this is high switching cost&period; Houses and communities are expensive to build and bought&period; Consumers can not switch easily&period; Moreover&comma; every consumer wants to live in a modern building&comma; house or society&period; Modernization comes with a cost hence&semi; buyer has to bear the expense of a good living&period; There are few choices available for consumers&comma; which lowers their bargaining power &lpar;Barashkova&comma; 2018&rpar;&period;<&sol;p>&NewLine;<h2 align&equals;"justify">Bargaining Power of Suppliers<&sol;h2>&NewLine;<p align&equals;"justify">Bargaining power of suppliers in the construction or real estate industry is high&period; Because of the raw materials provided by them are expensive and suppliers are less than buyers&period; Moreover&comma; the bargaining power of the land holders is high&period; The land is mainly belongs to the nation&period; The Company garden has to purchase the tenure as being developer&period; As the supply of land is limited&comma; bargaining power of the supplier increases&period; However&comma; Country garden is operating in the industry for two decades&comma; but still it has to bear the high cost of acquisition of land&period; However&comma; company is able to maintain good relationship with other raw material’s supplier to achieve economies of scale &lpar;Zhang and Ren&comma; 2006&rpar;&period;<&sol;p>&NewLine;<h2 align&equals;"justify">Threats of New Entrants<&sol;h2>&NewLine;<p align&equals;"justify">Threats from the new entrants in this industry is moderate to high&period; Real estate industry requires high capitalisation&period; It needs to buy a land&comma; then raw materials&comma; and the whole process goes on&period; The new entrant as to build effective supply chain and distribution networks to gain economies of scales&period; The company needs to attract new consumers to sell its houses and buildings&period; It is necessary for the new entrants to follow the strict rules and policies set by the government&period; the new entrants have to take several risks&comma; and consistency in order to survive in the industry &lpar;Barashkova&comma; 2018&rpar;&period;<&sol;p>&NewLine;<h2 align&equals;"justify">Threats from the Substitute Products<&sol;h2>&NewLine;<p align&equals;"justify">Threats from the substitute products are high for Country Garden Holdings&period; This is mainly because of the changes in the consumer needs and demands&period; This is greatly influenced by the purchasing power of the people&period; More the income&comma; higher will be the living standard&comma; and so the business of Country Garden will be successful&period; However&comma; those who have low income will switch towards substitute&period; The changes in the consumption of automobiles also influence this threat&period; More the pollution and traffic because of automobiles&comma; People wants to live in a quiet place&comma; away from the traffic noise&period; if the Country garden builds houses only in commercial areas&comma; people will switch to substitutes&comma; like in urban areas with peace and quiet &lpar;Zhang and Ren&comma; 2006&rpar;&period;<&sol;p>&NewLine;<h2 align&equals;"justify">Rivalry of Existing Players<&sol;h2>&NewLine;<p align&equals;"justify">Country Garden Holding is working in the real estate industry and believe in providing good and modern houses to the people&period; The company is facing competition from the competitors in China like China Vanke CO&comma; Evergrande real estate group etc&period; These companies are giving tough competition to each other&period; It is necessary for the Country Garden to build new and most innovative houses to stand odd one out&period; It should attract more consumers and should maintain its strong brand image &lpar;D&amp&semi;B Hoovers&comma; 2019&rpar;&period;<&sol;p>&NewLine;<h2 align&equals;"justify">References<&sol;h2>&NewLine;<p align&equals;"left">Barashkova&comma; E&period; 2018&period; Analysis of Construction Company’s Competitiveness Factors and Development of Its Competitive Strategy&period; &lbrack;Online&rsqb;&comma; Available at&colon; file&colon;&sol;&sol;&sol;C&colon;&sol;Users&sol;CC&sol;Dropbox&sol;Business&percnt;20Law&sol;F1-DP-2018-Barashkova-Ekaterina-Analysis&percnt;20of&percnt;20Construction&percnt;20Company&&num;8217&semi;s&percnt;20Competitiveness&percnt;20Factors&percnt;20and&percnt;20Development&percnt;20of&percnt;20Its&percnt;20Competitive&percnt;20Strategy&period;pdf&comma; &lbrack;Accessed on&colon; 1st December&comma; 2019&rsqb;&period;<br &sol;>&NewLine;Country Garden&comma; 2019&period; What we are&quest; &lbrack;Online&rsqb;&comma; Available at&colon; <a href&equals;"http&colon;&sol;&sol;www&period;countrygarden&period;com&period;cn&sol;about&period;aspx">http&colon;&sol;&sol;www&period;countrygarden&period;com&period;cn&sol;about&period;aspx<&sol;a>&comma; &lbrack;Accessed on&colon; 1st December&comma; 2019&rsqb;&period;<br &sol;>&NewLine;D&amp&semi;B hoovers&period; 2019&period; COUNTRY GARDEN HOLDINGS COMPANY LIMITED&period; &lbrack;Online&rsqb;&comma; Available at&colon; <a href&equals;"http&colon;&sol;&sol;www&period;hoovers&period;com&sol;company-information&sol;cs&sol;company-profile&period;country&lowbar;garden&lowbar;holdings&lowbar;company&lowbar;limited&period;22fd637cef271669&period;html&quest;aka&lowbar;re&equals;1">http&colon;&sol;&sol;www&period;hoovers&period;com&sol;company-information&sol;cs&sol;company-profile&period;country&lowbar;garden&lowbar;holdings&lowbar;company&lowbar;limited&period;22fd637cef271669&period;html&quest;aka&lowbar;re&equals;1<&sol;a>&comma; &lbrack;Accessed on&colon; 1st December&comma; 2019&rsqb;&period;<br &sol;>&NewLine;Zhang&comma; G&period; and Ren&comma; X&comma; 2006&period; ANALYSIS OF THE COMPETITION ENVIRONMENT FOR REAL ESTATES&period; &lbrack;Online&rsqb;&comma; Available at&colon; file&colon;&sol;&sol;&sol;C&colon;&sol;Users&sol;CC&sol;Dropbox&sol;Business&percnt;20Law&sol;CIB5813&period;pdf&comma; &lbrack;Accessed on&colon; 1st December&comma; 2019&rsqb;&period;<&sol;p>&NewLine;

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